Dell Q4 revenue up, net income falls

Met analyst expectations for quarterly revenue, but a one-time charge caused a decrease in net income.

by
Tom Krazit
, | 11 Feb 05

Dell continued to post solid growth across its IT hardware businesses in its 2005 fourth fiscal quarter, meeting analyst expectations for quarterly revenue. However, a one-time charge caused a decrease in net income during the quarter, the company said on Thursday.

For the period ended January 28, Dell recorded $13.5 billion in revenue, in line with the consensus expectation from analysts polled by Thomson First Call and up 17 per cent from last year's fourth quarter revenue of $11.5 billion.

Net income was $667 million, down 11 per cent from $749 million in last year's fourth quarter. The decrease was due to a one-time charge of $280 million related to the US American Jobs Creation Act, a recently passed law that allows US companies for a limited time to invest earnings from overseas operations in certain US-based activities at a favourable tax rate.

Without the charge, net income was $947 million. Earnings per share without the charge were $0.37, slightly higher than analyst consensus expectation of $0.36 a share.

For the full fiscal year company posted $49.2 billion in revenue, an increase of 19 per cent from the $41.4 billion recorded during its previous fiscal year.

Shipments of all products worldwide increased by 19 per cent compared to last year, which Dell said outpaced the rest of the industry excluding the company by 7 per cent.

Dell expects worldwide shipments to increase even faster, 21 per cent, in its first 2006 first fiscal quarter, compared to 2005's first fiscal quarter, generating quarterly revenue of $13.4 billion. The first half of the calendar year is generally slower for hardware firms than the second half.